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The Zacks Analyst Blog Highlights: Electronic Arts, GameStop, Sony, Activision Blizzard and King Digital Entertainment

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For Immediate Release

Chicago, IL - December 14, 2015 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Electronic Arts ( EA ), GameStop Corp. ( GME ), Sony Corporation ( SNE ), Activision Blizzard, Inc. ( ATVI ) and King Digital Entertainment plc ( KING ).

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Here are highlights from Friday's Analyst Blog:

Video Game Stock Roundup

Among the top stories this week, research firm NPD reported video games sales data for the month of November. Meanwhile, Electronic Arts ( EA ) got battered again as videogame retailer GameStop Corp. ( GME ) slashed the price of EA's highly anticipated Star Wars Battlefront .

Sony Corporation ( SNE ) also slashed the price of PS4 as a part of its holiday sales strategy. On the other hand, Activision Blizzard, Inc. ( ATVI ) moved a step closer to concluding the acquisition of Candy Crush maker King Digital Entertainment plc ( KING ).

Top Stories This Past Week

1. As per a VentureBeat report, The NPD Group issued video game sales numbers for the month of November. As per NPD, new game software, hardware, and accessories at physical retailers for the month grew 2% year over year to $2.47 billion. The primary driving factor was an 11% increase in hardware sales to $1.12 billion. Sony's PS4 emerged as the highest selling console.

Moreover, the report observed that gamers were fast "embracing" newer consoles as reflected in a 22% jump in sales of eighth generation consoles, which include Xbox One, PS4, and Wii U. Last generation consoles sales saw a massive drop of 76%. Notably, eighth gen-consoles comprised 93% of total hardware sales, up 9 percentage points year over year.

Coming to software, sales tumbled 7% to $993.9 million. Despite the fall, an NPD analyst made a key observation that "games were an even hotter item for gift buyers and deal seekers this year than last." Video games emerged as the top selling retail item on Thanksgiving and Black Friday.

Activision Blizzard's Call of Duty: Black Ops 3 topped sales for the month, overtaking the likes of Bethesda Softworks' Fallout 4 and EA's Star Wars Battlefront . Black Ops 3 and Just Dance 2016 (placed at the bottom) were the two games in the top 10 list that sold higher on Xbox and Wii, respectively, than PS4.

NPD also pointed out that despite being one of the finest games of 2015, Rise of the Tomb Raider could not break in to the top 10 list as it was just "exclusive to one console". However, Microsoft's Halo 5: Guardians compatible with only Xbox, did manage to feature on the list at the eighth spot. Other games included in the list are Madden NFL 16, NBA 2K16, FIFA 16 , Need For Speed and Assassin's Creed: Syndicate.

Moreover, new combined software sales of Xbox One, PS4, and Wii U were the highest ever in Nov 2015,increasing 34% from Dec 2014, which to date held the record for highest combined software sales.

Moving to peripherals and interactive toys, sales grew 6% to $357.7 million. It is to be noted that NPD doesn't include mobile, digital, and GameStop's second-hand market game sales. It just considers new games sold at retailers.

2. EA stock was again battered as GameStop slashed price of Battlefront by as much as $20. Even Amazon.com took down the price to $39.99 for PS4 and PC compatible versions as per TheStreet. Nonetheless, the price cut has been touted by an analyst as a premeditated move by both EA and GameStop to drive retail sales of Battlefront in the holiday season. Dismissing any weakness in the title, he said that the same trend was witnessed for Battlefield 3 and 4 . The title is expected to sell 13 million copies.

However, it is to be noted that Battlefront has fallen short of users' expectations. Though the game is visually stunning, the "lack of options and limited gameplay" are big disappointments. Gamers also find the game "incomplete" and accuse EA of releasing it in a rush so as to benefit from The Force Awakens hysteria.

3. Apart from that, EA was also in the news for its "Competitive Gaming Division." As per a CNET report, EA is launching an e-sport division that will "help to create global competitions" for its franchises like Battlefield, Madden and FIFA. E-sports has been fast emerging as a lucrative business opportunity for video game publishers.

Earlier, Activision also had launched an e-sports unit spearheaded by former ESPN CEO Steve Bornstein. Though a bit puzzling, the concept of e-sports has found takers. E-sports refers to live video game tournaments. Like traditional sports, even these are held at stadiums and are televised or broadcast online. Importantly, these tournaments have alluring prize money.

4. To make the most of the holiday season, Sony has offered huge price cut on its PS4 hardware. The company will offer a discount of $50 on the Star Wars Battlefront standard edition and Uncharted: The Nathan Drake Collection from Dec 6 til Dec 19. However, Microsoft has yet to offer any such lucrative deal for Xbox One, which starts selling $350 currently.

5. Activision Blizzard moved one step closer to concluding the acquisition of King Digital. The company through its wholly owned subsidiary ABS Partners C.V. and King Digital has "despatched proposals to the holders of convertible securities of King Digital Entertainment plc in accordance with the requirements of Rule 15 of the Irish Takeover Rules together with the form of acceptance for each proposal."

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ELECTR ARTS INC (EA): Free Stock Analysis Report

GAMESTOP CORP (GME): Free Stock Analysis Report

SONY CORP ADR (SNE): Free Stock Analysis Report

ACTIVISION BLZD (ATVI): Free Stock Analysis Report

KING DIGITL ENT (KING): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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